Gifting excess income

A question about : Gifting excess income

I am soooo confused! I have been told that I can save on IHT (or, rather, my children can) by giving them money out of my income. I actually have been doing this anyway - I pay a set amount off my daughter's credit card every month and I pay life and house insurances for my son every month. Apparently, so I am told, this has some IHT benefits for them but I cannot understand how. Also, I have been told that by setting this precedent the Revenue will assume IHT relief for the kids over a few years (not sure how many) even if I only pay these sums for 3 or 4 months. This sounds too good to be true - and we all know what they say... if it sounds too good to be true it's probably not true lol. Can anyone put me right, please?

Best answers:

• So, basically, it's just a way of getting rid of my money so the children get less cash left them that they have to pay iht on when I die. It would be the same result as me spending it on my selfish self.
• I'm a bit confused. I currently save Јx a month. If I give part or all of that that to the kids instead, it doesn't count towards the Ј3k gift limit? How often for it to be 'regular'? And can I give them Ј3k from savings as well? And is it Ј3k each or Ј3k in total?
• Thanks for all the helpful replies. However, going back to my original question, anyone any thoughts on the bit about setting a precedent by giving the children some money over a few months and then the Revenue allowing IHT relief as if I'd been paying them for some years? That can't be right, surely?
• Ironically, just as it looks as if we need to get rid of excess cash - we've been left Ј30,000 in a relative's will!!!
• I, too give excess money to my son and grandson. We both have some savings for emergency but we have about 1k excess a month therefore I have set standing order for son and grandson every month. I am not concerned about IHT as I do not think my assets will be 650k when I die but am concerned about nursing care as I believe council can look back in my account and consider it as depriving of assets. I do have a choice of spending the 1 k now but I have opted to help them and I do not think it is fair if I am penalised.
• Surely, if you just lift the money each month, and give them the cash, no one is going to question what you do with it.
• Except that the LA will investigate and if they discover your cunning plan ............
  I love some of the lapses in morality that surround this issue with some people!